Bank to take over Belmont Park

Bankruptcy ruling follows rent dispute with city

Tom Lochtefeld, master leaseholder at Belmont Park, in front of the Giant Dipper roller coaster at Belmont Park last November after he filed for bankruptcy amid a rent dispute with the city of San Diego.

Tom Lochtefeld, master leaseholder at Belmont Park, in front of the Giant Dipper roller coaster at Belmont Park last November after he filed for bankruptcy amid a rent dispute with the city of San Diego.

The future of Mission Beach’s Belmont Park remains uncertain after a court ruling Thursday, but one thing is certain: The man who engineered the amusement park’s revival over the past decade won’t be part of that future.

A bitter rent dispute that began last year between the city of San Diego and businessman Tom Lochtefeld, who has run the city-owned amusement park since 2000, set off a chain of events that culminated in a bankruptcy hearing Thursday that ended with Lochtefeld essentially handing the park’s keys over to a bank that he owes $17 million.

The next step will be to install a court-appointed receiver in the coming weeks to operate the park while the bank formally forecloses on Lochtefeld’s lease rights to the property. Lochtefeld will continue to run the facility until then.

The change in management ends what had been a successful relationship between the city and Lochtefeld under which he paid minimal rent in exchange for heavily investing in the park. The result was a financial turnaround for the once-flagging park that saw its annual revenue soar from $9 million to $21 million during Lochtefeld’s tenure.

The relationship soured after the city spurned Lochtefeld’s plan to develop a hotel and water attractions at the site to make the park economically viable. City officials say the idea was never formally submitted — as required by the lease — and therefore Lochtefeld was no longer eligible for certain rent subsidies as of June 2010. Annual rent increased from $70,000 to an estimated $550,000. Lochtefeld refused to pay because he couldn’t afford the higher rent and pay off his bank loan because park profits weren’t big enough.

The city filed a default notice in October and Lochtefeld filed for bankruptcy a few weeks later. In May, he closed the historic Plunge pool because it needed repairs he couldn’t afford because of the rent dispute and began a public campaign to rally community support to his side.

A frustrated Lochtefeld held a news conference after Thursday’s hearing and said the city was being shortsighted by seeking more rent and not looking at what could happen to Belmont Park when he leaves. The park changed hands twice before as developers failed to create a viable retail center there.

“I think that the business model that they’re proceeding with is a failed business model and what will happen is it will turn from Mission Beach to Mission Blight,” Lochtefeld said.

He also said he offered to pay $70,000 in rent and spend $100,000 on repairs that would allow the Plunge to reopen, but city officials rejected that plan last week.

Jay Goldstone, the city’s chief operating officer, issued a statement saying the judge’s decision makes East West Bank the property’s new leaseholder and places operations in a receivership.

“We’re working with the bank to ensure the park continues to operate without interruption and remains a benefit to the San Diego community,” he said.

Richard Woltman, a La Jolla businessman who regularly swims in the Plunge, said he worries about the seniors, disabled and children who no longer have a nearby pool for recreation and exercise.